Ted Baker [IRDX RTED] said its ecommerce sales grew by more than 40% in the first half of its financial year. We take a look at its multichannel strategy.
Group revenue of £295.7m was 14% up on the same time last year, while pre-tax profits of £25.3m were 17.8% ahead. Retail sales of £217.7m were up by 13.9%, or 9.2% when currency fluctuations were discounted. In the UK and Europe they reached £145.6m, up by 11%, while North American sales of £60.7m were 18.8% ahead, and Asian retail sales of £11.4m were 29.5% up. Its wholesale channel brought in £78m, 14.1% up on last time, while income from licensing grew by 23.1% to £9.7m. Womenswear accounted for 60% of sales and menswear for 40%.
Chief executive and founder Ray Kelvin said: “The Ted Baker brand has continued to perform well and in line with our expectations across all distribution channels. This good performance reflects the strength and appeal of the Ted Baker brand, our business model and the passion, creativity and innovation of our global teams.
“We have a clear strategy for the development of the brand across both established and newer markets and this remains underpinned by the focus on design, quality and attention to detail that is at the core of everything we do.
“We are dedicated to the long-term development of the Ted Baker brand and are continuing to invest in our infrastructure and people to support our future growth. Whilst trading conditions in some of our markets remain challenging, we are confident of making further progress for the full year, in line with our expectations.”
The brand is expanding through new physical stores and concessions. Its plans include new stores in the US, UK, China, and France, as well as new outlets in the UK and Netherlands. It is also working with department stores in the UK, Europe and Asia to open new concessions, and is working with licensees in Australia, the Middle East and Central America.
“Our ecommerce business is an integral and increasingly important component within our retail proposition and has performed very well, delivering sales growth of 43.8% (40.7% in constant currency),” said Ted Baker in today’s financial statement. “We continued to invest in our retail channel with considered store openings across all territories and further development of our ecommerce platforms.”
Ecommerce sales accounted for 23.8% of UK and European retail sales, 11.4% of North American sales, and 9.6% of Asian sales.
Ted Baker has centralised its European logistics in one single distribution centre, from three previously. That centre handles logistics for its retail, ecommerce and wholesale businesses in the region. Distribution costs grew to £117.8m, 13.6% ahead of the £103.7m incurred last time. They accounted for 39.8% of sales, slightly down from 40% last time, thanks, it said, “to the decrease in dual running costs associated with the transition to our new single European distribution centre, partially offset by investment in online marketing costs to increase awareness of local ecommerce sites and some pre-opening costs in Asia.”
Meanwhile, administrative expenses of £40.4m accounted for 14% of sales as its head office grew both in the UK and abroad, and reflecting investment in IT and customer engagement.
Mentioned in this piece…
Ted Baker is a British clothing retail company.
Ted Baker plc is listed on the London Stock Exchange and is a constituent of the FTSE 250 Index.
Ted Baker’s managing director, Ray Kelvin, started his first store in March 1988 in Glasgow, and opened further stores in Manchester, Plymouth, and Nottingham. (more…)
- Image courtesy of Ted Baker